Three former employees of video-streaming giant, Netflix, were accused of generating $3.1 million in profit by trading on insider information about Netflix’s subscriber growth, according to a report of a complaint filed Wednesday by the Securities and Exchange Commission (SEC).
The ex-employees were software engineers, who have been accused of the ‘insider trading’ ring along with two of their associates.
SEC said Sung Mo ‘Jay’ Jun, a former Netflix software engineer, was at the ‘centre of the insider trading ring’ and accessed key information about Netflix’s subscriber growth to pass on the information to his brother, Joon Mo Jun, and his friend, Junwoo Chon, ahead of the streaming company’s quarterly earnings from 2016 to 2019.
As per the complaint, Chon paid Jun $60,000 in cash for his assistance between 2016 to 2017.
The report also states that after Jun left Netflix in February of 2017, he continued to receive insider information from Ayden Lee, another software engineer at Netflix, all the way through 2019, which he used to inform his own trading and informed about the samer to his brother and friend, according to the SEC.
Sung Mo Jun, Joon Mo Jun, Chon and Jae Hyeon Bae, another Netflix employee who rejoined the company after Jun had left, also used a group messaging platofrm to share insider information and trading tips, and Bae had instructed Joon Mo Jun to sell shares of Netflix ahead of the company’s 2019 earnings report, the SEC reportedly said.
“In total, Sung Mo Jun, Joon Jun, and Chon netted over $3.1 million in illicit profits from trading Netflix securities based on material, non-public information provided by Netflix insiders,” the complaint said.
The SEC charges come along with another criminal case in Seattle, where the U.S. Attorney’s Office for the Western District of Washington filed a criminal information against Sung Mo Jun, Joon Mo Jun, Chon and Lee.
Netflix is yet to comment on these claims, according to reports.
For all the latest business News Click Here
